TRANSPORT group Arriva signalled the end of an era yesterday when it announced plans to sever its ties with the motor trade.

The North-East based international bus and train operator, which began as a back street motorbike repair business in the 1930s, wants to sell off its 33 motor franchises across the UK to expand its passenger activities.

Lloyds TSB is already being tipped as a possible bidder, but Arriva has said it would be prepared to sell off the motor division either wholesale or piecemeal by individual site.

The news was greeted philosophically by the North-East millionaire, Sir Tom Cowie, the son of the business's founder, who oversaw rapid expansion of the company.

Under his guidance, the business grew from a small corner shop selling motorcycles in Sunderland to one of Britain's biggest motor dealers. It moved into the motor trade in 1960.

He stood down as chairman in 1993. And in 1997, he was not pleased at the company's subsequent name change, dropping the Cowie family name to become Arriva.

Yesterday he was philosophical.

"You can't halt progress, the company has taken a totally different direction and it's now a leading transport company, not only in this country, but also on the continent," he said.

"There is no need to be sentimental about this.

"It has changed direction enormously and has expanded, and I'm very pleased with the performance of the company. This decision makes sense."

Announcing the decision yesterday, Mr Davies said: "Our objective will be to maximise shareholder value, while securing the continued employment of as many employees as possible."

Arriva's car retailing arm employs 2,000 staff, 50 at the head office on Sunderland's Doxford International Business Park.

It also runs the Arriva Northern Trains franchise and a fleet of more than 6,000 buses round the country and in Europe. Analysts have valued it at about £55m, with its franchises including BMW, Jaguar, Rover and Vauxhall dealerships.

Arriva said agreements with each of the motor companies was due to end over the next year or two.

Management at Sunderland were busy informing staff of the decision yesterday, after the news was released to the Stock Exchange.

Lloyds TSB is understood to be interested in the car dealerships as a means of helping to supply its own car-leasing division and customers for its loan arm.

A bank spokeswoman refused to comment directly on the speculation, but said: "We are always on the look out for opportunities across our business."

Humble beginnings in a bike repair shed

THE billion-pound Arriva business was founded as a direct result of the depression-hit Wearside shipbuilding industry of the 1930s.

When shipyard worker Thomas Cowie was laid off from the Deptford yard in Sunderland he decided to try to earn a crust from his hobby of motorbikes.

He began repairing motorcycles in a shed in the back yard of the family home in Westbury Street, in Millfield, Sunderland.

Several years later son Tom, who inherited his father's love of motorbikes, joined virtually straight from school as company secretary at the age of 16, in 1938.

Their first shop premises was next to St Mark's Church, Millfield, and remained the company headquarters for decades to come.

With the demise of the British motor cycle industry, Cowies underwent a change of direction in 1960 selling, initially, second-hand cars, before it moved on to the new car and eventually fleet hire trade.

Sir Tom retired as chairman of the Cowie Group in 1993 and remains life president of the now international Arriva transport business.

The 80-year-old country sports lover, a former chairman of Sunderland AFC, now lives on the Broadwood Estate in 16 acres of the upper Browney Valley, in north-west Durham.

Sir Tom can reflect proudly on the part he played in the rise of the business.

It now has 35,000 employees, a £1.5bn turnover and plush headquarters premises on Sunderland's Doxford International Business Park - a far cry from back Westbury Street in the depression-hit 1930s.

He has also left a legacy on Wearside with £2m given away to good causes through the Sir Tom Cowie Foundation, while his donations have funded the development of St Peter's campus at Sunderland University.

It was recently renamed the Sir Tom Cowie Campus at St Peter's to mark the former motor magnate's generosity.